Asia Wealth Securities (AWS) released an analysis for the trading session on November 12, 2020, indicating the essential events in the stock market as follows:
The overall investment today – AWS expects the SET today (12 Nov) to continue volatility from yesterday. This is partly due to concerns over the COVID-19 situation that comes back to pressure overall investment after the U.S. announced curfews in many states to prevent the spread.
In addition, profit-taking after the SET Index in November rose 12.6% compared to the end of October.
However, AWS believes the SET will hold back to continue. AWS weighed the issue of declaring a curfew in the U.S. will not much affect investment in the region, including the SET Index, while there is still a positive factor from fund Inflow, the price of crude oil continues to increase, and anticipating the success of vaccine development in the near term, especially in the case of Russian vaccine development.
It was also reported that the developed vaccine (Sputnik V) was 92% effective against COVID-19.
For investment strategy, AWS continues to select stocks in global play, and stocks that benefit from the near-term success of vaccine development.
WTI crude oil has rallied for a third consecutive day after having previously gained positive estimates of success in vaccine development. Recently, the American Petroleum Institute (API), a group of the U.S. oil industry reported U.S. crude oil reserves fell 5.1 million barrels last week (ending 6 Nov) which decreased more than Market Consensus estimated at 913,000 barrels.
While the U.S. Energy Information Administration (EIA) will report crude oil reserves today (12 Nov). Market Consensus estimates crude oil reserves will drop 3 million barrels last week.
Dow Jones slightly dropped along with the NASDAQ index rose after the COVID-19 situation in the U.S. still harsh so investors had profit-taking after the Dow continued to increase over the past week.
And another negative factor is the number of states enacting a curfew to control the spread of the COVID-19 virus, with the U.S. still having new infections which the average increase of more than 100,000 cases per day so it is one of the concerns which AWS commented earlier, especially after Mr. Joe Biden was the winner of the U.S. presidential election, it is likely that AWS will see more stringent epidemic control measures being adopted.
However, AWS believes that these factors will have little impact on investment in the Thai and regional stock markets.
Technical View – Today, AWS expects the SET Index to move between 1,330-1,364 points. The recommended stocks are OSP, NER, SAWAD, ANAN and CKP.
1) Global Play (Trading within 1 month) – PTT, SCC, PTTEP, TOP, PTTGC, IVL, CPF and TU
2) Stocks which obtained the benefit from the nearest successful of COVID-19 vaccine (Trading within 1 month) – AOT, AAV, BA, ERW, M, CRC, CENTEL, MINT, WHA and AMATA
3) Dividend Play (Middle-term trading 6-12 months) – SC, LH, QH, KKP, TISCO, RATCH, DIF, INTUCH, EASTW and TTW
4) Long term accumulative stocks (DCA) (Long-term trading over 1 year) – AOT, BEM, ADVANC, WHA, LH, CPALL, CPF, BDMS, HMPRO, BBL and KTB